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hi pls help 5. Swaps Companies A and B have been offered the following rates per annum on a 10 million kr 4-year investment: Company
hi pls help
5. Swaps Companies A and B have been offered the following rates per annum on a 10 million kr 4-year investment: Company Fixed Rate Floating Rate Company A 6.0% LIBOR Company B 6.6% LIBOR +0.2% (a) Design a swap between company A and company B that is equally attractive to both companies, if company A requires a fixed-rate in- vestment and compally B requires a floating-rate investment? (b) A swap can be viewed as a package of zero coupon bonds and floating rate bonds. Carefully explain this statement. If you need to introduce any notation, you should define it clearly. No calculations are neededStep by Step Solution
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